The FTA signed between South Korea and the United States will have little impact on Taiwan’s textile industry
South Korea and the United States have signed an FTA, and most Taiwanese textile industry players believe it will have little impact. Huang Weiji, secretary-general of the Taiwan Textile Association, said that Taiwan’s textiles are mainly sold to mainland China, Southeast Asia, South Asia and other places, accounting for 70%, with only 4% in the United States and less than 3% in Europe. In addition, Taiwan’s textile industry is highly competitive. After passing through South Korea, it will have minimal impact on Taiwan’s textile industry.
Taiwanese industry players said that the garment industry is a highly labor-intensive industry, and wages in South Korea are higher than in Taiwan. Therefore, Korean businessmen often locate their factories in developing countries with lower wages. The FTA between South Korea and the United States has taken effect, and only goods produced in South Korea that are directly sold to the United States enjoy zero tariffs. The benefits to South Korea’s garment industry are not profound, so the threat to Taiwan is not great. The profits of Taiwan’s textile industry are still highly correlated with the increase in raw material prices.
In order to avoid the impact of the decline in U.S. consumption on profits, Taiwanese companies are actively exploring customers in Asia and other regions.
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